Colp & Cofa

The COLP and COFA changes have been paused, but the debate has highlighted an important question for small conveyancing firms: how can they demonstrate effective oversight without creating disproportionate cost?

The Conveyancing Task Force has warned that the proposed arrangements could influence which transactions smaller practices accept and reduce consumer choice. Its concerns deserve consideration alongside the SRA’s objective of strengthening protection for client money.

For managing partners and compliance officers, the immediate task is to understand the developing position and review existing safeguards. That includes checking whether governance arrangements, client-facing terms and internal policies accurately reflect how the firm operates.

Position reviewed on 12 October 2026. Implementation has been paused. Firms should check subsequent SRA announcements before acting on an implementation timetable.

Why the Conveyancing Task Force is concerned

Following its October meeting with the SRA, the Conveyancing Task Force asked for stronger evidence supporting the proposed changes, including the choice of turnover and client-money thresholds.

Its concerns include whether a small practice handling higher-value properties could face additional obligations despite having a relatively modest team and turnover. It also questions whether firms might decline such instructions, directing work towards larger providers.

These are potential consequences identified by the Task Force, rather than established outcomes. The policy question is whether the additional protection achieved would justify the operational and financial burden.

What the SRA was seeking to address

The SRA’s stated concern is the concentration of significant management power and compliance oversight in one individual.

Its September explanation clarified that the intended restriction concerned unilateral decision-making authority, rather than automatically excluding every partner, owner or senior manager from a compliance role.

The announced approach used annual turnover above £600,000 or client money above £2 million, subject to the detailed rules. It did not require both thresholds to be exceeded.

There was different treatment for sole owner-manager firms exceeding only the client-money threshold, together with a limited exemption for qualifying exceptional transactions. Those provisions require careful reading; a temporary balance is not automatically exempt.

The SRA subsequently paused implementation to consider concerns and further options. Firms should distinguish the previously announced approach from whatever requirements and timetable emerge following that process.

The £2 million issue is not simply about one expensive property

Illustrative example: A small conveyancing practice handles several ordinary residential completions on the same day. The combined purchase funds temporarily create a substantial client-account balance.

That balance may reveal something about the money exposed to operational risk. It does not, by itself, describe the firm’s staffing, transaction volume, profitability or the effectiveness of its controls.

Conversely, a modest turnover does not remove the need to protect substantial sums. A useful assessment needs both the financial exposure and the safeguards applied to it.

Practices considering the possible impact should examine their actual balance history, rather than assume that the price of a single property determines the answer.

Existing COLP and COFA responsibilities continue

The pause does not suspend existing compliance obligations.

The SRA’s guidance on COLP and COFA responsibilities explains the need for appropriate systems, effective reporting lines and records demonstrating compliance.

A practical review should ask whether the compliance officer can obtain information, challenge a decision and ensure that a concern receives a documented response.

Changing a job title is not sufficient if the person holding it lacks time, authority or access to the information needed to perform the role.

Should the firm’s terms and conditions change?

The paused proposals do not themselves create a blanket requirement to rewrite every firm’s terms and conditions.

However, a review is appropriate where the firm changes its service, client-money arrangements, payment procedures or client communications. The engagement documents should accurately explain the arrangements the client will experience.

Potential areas for review include:

• Scope of the retainer: which services the firm has agreed to provide and any clearly explained limitations.
• Payment arrangements: when funds are required and what information clients must supply.
• Verification procedures: how clients should confirm payment instructions and communicate changes securely.
• Completion dependencies: circumstances in which unresolved checks or missing information may affect the timetable.
• Complaints information: whether the published process and contact details remain accurate.

Any amendment must be fair, clear and consistent with the firm’s legal and regulatory duties. Terms cannot transfer those duties to the client or compensate for inadequate internal controls.

Lexsure’s CLIENTCAREmonitor Terms and Conditions Generator supports the preparation of terms using matter parameters and optional clauses. The firm must still select, review and adapt the wording for its practice and instructions.

Use notifications to support a documented review

A firm may have a sound set of terms but no reliable process for reviewing them as its work and risks change.

The CLIENTCAREmonitor Terms and Conditions Notification Service provides monthly notifications of new wording for consideration. It allows firms to retain their existing process for generating terms while reviewing relevant additions.

The useful discipline is to record the decision: which suggestion was considered, whether it applies, who approved any amendment and when the revised wording came into use.

Receiving an update is the start of that process. It does not establish that the firm has implemented an appropriate change.

CQS policies should reflect the operating arrangements

For a CQS-accredited conveyancing practice, client-facing documents and internal policies should be consistent with each other.

If the firm tells clients that a payment instruction will be verified in a particular way, the corresponding procedure should identify who performs the check and what evidence is retained.

Relevant areas for review may include:

• Client care and communication.
• Risk management and escalation.
• Information management and security.
• Dealing with lenders.
• Business continuity and cover for absences.
• Learning and development for compliance responsibilities.

Lexsure’s CQS CPMS Policy Template Library provides drafting starting points. Its CQS Policy Update Service provides proposed additions for firms to consider as part of ongoing review.

Templates should be tailored to the practice. The procedures described must be workable, communicated to staff and supported by evidence of implementation.

Our article on why COLPs need to keep compliance policies up to date explains how documents can gradually fall behind the way a firm actually operates.

Five useful steps during the pause

1. Map decision-making authority. Compare the written governance arrangements with what happens in practice.
2. Review the financial data. Identify turnover, peak client-money balances and the transactions behind those balances.
3. Test existing safeguards. Consider payment authorisation, reconciliation, escalation and management review.
4. Check document consistency. Reconcile the terms, client-care letters, policies and staff instructions.
5. Record the review. Allocate actions and monitor regulatory announcements before making structural changes.

For firms contributing to the debate, practical evidence will be valuable: how balances arise, which controls operate and what a proposed structural change would cost or improve.

The objective should be demonstrable protection for clients, supported by arrangements that are proportionate and effective for the practice.

This article concerns SRA-regulated firms in England and Wales. It reflects the position reviewed on 12 October 2026 and provides general information. Firms should check the applicable rules and subsequent announcements before changing appointments or governance arrangements.